U.S. mobile paid search spending rockets upward in Q1

By Amy DustoAssociate Editor

Meanwhile, paid search spending on PCs holds steady, a study says.

U.S. digital advertisers increased their year-over-year paid search spending in the first quarter for smartphones and tablets by 113% and 112%, respectively, according to a new report from IgnitionOne Inc. That growth appears to come directly from those advertisers’ budgets for paid search on PCs, the digital marketing technology provider says. Total U.S. paid search spending remained flat in Q1 compared with both Q4 and all of 2012.

The report gave no spending figures.

The shift in spending comes as more consumers use mobile devices, the report says. Tablets in particular garnered a 79% year-over-year increase in the number of clicks on paid search ads in Q1, while smartphones registered a 25% increase, the report says.

IgnitionOne predicts paid search spending will skew further towards mobile as more advertisers begin to use Google Inc.’s Enhanced Campaigns, a tool the search engine released in February to help retailers customize ads across many devices and for variables such as time of day and geographic location. However, it also eliminates the distinction between PCs and tablets, so any ad targeting consumers on PCs will also be presented to tablet users.

Additionally, after Google in October eliminated free product listings in its Google Shopping Array, substituting paid Product Listing Ads, some of advertisers’ paid search budgets adjusted to finance those ads, IgnitionOne says. However, without giving specific numbers, it says that paid search ads—which appear on the top and side of search results pages—attract higher click-through rates when advertisers also purchase Product Listing Ads that appear in the center column of the page, so marketers have more reason to increase spending on both ad formats.

Retailers that aren’t buying Product Listing Ads at all suffer in not only Google Shopping search results but in “universal” search results, too, according to a another study by search analytics software provider Searchmetrics. Universal search refers to how Google.com returns a mix of results depending on a user’s search terms. Beyond typical organic links, it displays images, videos, maps, news stories and sponsored advertising. Over the course of 2012, the overall number of universal search results containing information and media that retailers provided through their Google Shopping accounts dropped off by 79%, with the sharpest decline occurring in October, when Product Listing Ads stopped being free, Searchmetrics says. That drop-off does not include retailers’ organic search links, it says.

Of the shopping integrations that appeared in universal search results throughout 2012, more than half (52.02%) came from Google, without using the information and direct links provided by retailers via Google Shopping, Searchmetrics says. The rest were shopping integrations from Amazon.com Inc. (11.82%), eBay Inc. (4.28%), Sears Holdings Corp. (1.21%) and all other retailers (30.67%), it says.